Deka seeks Drapers Gardens

DEKA, the German fund manager, is the frontrunner to buy the iconic Drapers Gardens office building in the City of London, according to advisers working on the deal.

Drapers Gardens, which is owned by Canary Wharf and Exemplar Properties, was put on the market in March this year. The other bidders include European fund managers SEB and Aerium, and Sassan Ahsani’s Lumina Real Estate.

It is understood that the German fund manager has placed a £240m all cash offer for the 292,000 sq ft building, with a yield of 5.1 per cent.

The rapid turnaround in London’s commercial market has led to more sellers putting properties up for sale over the past six months.

James Beckham, head of City investment at King Sturge said: “Drapers Gardens is a good asset and the market is hot. It’s a tactical sale.”

BlackRock currently rents the building close to Liverpool Street Station, after signing a 25 year lease earlier this year.

According to a report out yesterday by accountants BDO Stoy Hayward, commercial property transactions in March have returned to pre-recessionary levels. But there are fears that the recent boom is unsustainable.

Solly Benaim, BDO’s head of real estate, said: “The post-election period will be crucial in determining the health of the market as decisions which would otherwise have been taken in the first quarter are likely to have been deferred until after 6 May. But there are positive signs.”